Experts canvass Diaspora investment policy

As Nigeria continues to grapple with the pains of an economic recession, experts are canvassing  that the Federal Government put in place policies to encourage more remittances from Nigerians in the Diaspora which could be invested in real estate, roads, rail and ports infrastructure.
Before now, Nigeria was adjudged the  largest receiver of remittances in sub-Saharan Africa and according to the Migration of Remittance Factbook 2016, about $21 billion was sent home by Nigerians in the Diaspora in 2015, making the country  the sixth largest receiver of remittances in the world.
Much of these remittances were invested in oil & gas and high end real estate, but with the slump in the prices of these investment asset class, the experts explain that investing in building houses, would be a good tonic for the economy because it can solve the housing problem and also create jobs for professionals and artisans.
An analysis of the Factbook report by Premium Times  shows that the United States and the United Kingdom  are the most lucrative destinations for Nigerian migrants, and that Nigerians at home received a total of $9.4 billion ($5.7 billion from the US and $3.7 billion from the UK) in 2015.
This means that  given the present exchange rate, where the naira goes for  N425 to a dollar and 553 to one pound, “just some thousands of dollars or pounds will give the migrants millions of naira which they can profitably invest in building houses”, the experts reasoned.
Olumide Osunsina, MD/CEO, Megamound Investment—developers of the multi-units Lekky County Homes—disclosed  in an interview recently, that his company now has a special arrangement in which they have structured an easy payment platform for Diaspora home buyers.
“They are no longer finding it difficult buying houses from us with the current exchange rate regime which places them at advantage; houses for which they would use a reasonable amount of dollars to purchase before, now with some tens of thousands of dollars, they can offset the cost”, Osunsina said.
In the past 12 months however, remittances to Nigeria have reduced considerably for reasons of lack of stability in the economy. A Diaspora Nigerian who pleaded anonymity, says “there are no clear directions; we don’t know what this government is all about. I am one of those who believe that in our circumstance, this is perhaps the best we can have, though it could be better”.
“The confidence level in the economy has gone down and some of the on-going projects which have foreign interests are struggling”, says Femi Akintunde, CEO, AMFacilities. Akintunde further states  that some foreign investors are reviewing their investment decisions, while some others have cancelled their business plans because they were no longer sustainable.
This perhaps explains why foreign funds are not forthcoming into the market despite the low demand, an oversupply at the high end, very high vacancy rate and price correction estimated at 20 percent in the residential and commercial office segments of the property market.
Gbenga Olaniyan, MD/CEO, Estate Links Limited, developers of a moderate estate called The Lofts, shared an experience with a Diaspora Nigerian, who he said with all the resources available to him, has chosen to buy just a unit of housing from the estate when he could pay for more because he was not sure of government’s next move back home.
“Despite the property price fall, foreign investors and Diaspora Nigerian potential home buyers  and investors who have the advantage of stronger currency are still holding back cash; this attitude is in tune with the realities of the time; once people are holding on to cash, it shows you that times are hard; a man who has N60 million is not ready to buy a house of N45 million because he does not want to hold only N15 million in an uncertain time”, Olaniyan says.

 

CHUKA UROKO